IKEA founder takes frugality ‘too far’

NEVER mind the recession, shoppers flocking to IKEA’s new Dublin store next year will still get more for their money because Ingvar Kamprad, the stingy founder of the Swedish furniture giant, always made sure he got more for his.

Mr Kamprad, in his 80s, is one of the world’s richest men but his reputation for thrift precedes him. He is famous for eating in cheap restaurants, staying in cheap bed and breakfast establishments, flying economy class and travelling by bus.

But the king of British interior design, Terence Conran, told RTÉ’s Marian Finucane that he was not too impressed by Mr Kamprad’s frugality.

“Being almost the richest man in the world, I think his frugality damages the business because I do not think he gives the service,” he said.

But Mr Conran is probably alone in his view, with the IKEA group having grown into a significant retail experience for millions of people in 24 countries, generating annual sales of more than €21 billion.

And Habitat, a large chain selling household goods and furniture in contemporary designs that Mr Conran founded in 1964 when he opened his first outlet in London, was purchased by the holding company that owns IKEA in 1992.

Earlier this year, however, Habitat’s two outlets in Dublin and Galway closed, becoming the first big retail casualty of Ireland’s economic downturn.

Mr Conran said Mr Kamprad, who was a business associate, was “demented” about cheapness.

“He thinks he has to demonstrate this by living a really pretty ridiculous austere life,” he said.

He recalled taking Mr Kamprad and his wife out to lunch in London and his wife telling them that they were buying silverware. Mr Kamprad interjected quickly that they were only buying silverplate.

Mr Conran said Mr Kamprad would always bargain to get the cheapest flight possible, stay in the cheapest bed and breakfast establishment, and would never think of taking a taxi.

“It is possibly why he is one of the richest men in the world. I do think he has done a remarkable job in getting great products at amazing prices into the shops,” said Mr Conran.

“Is he mean? I do not know. He is determined that his message to the world is: IKEA is the best value for money.”

Mr Conran said his furniture, which was made in Britain, was probably of better quality than what IKEA offered but, unlike Mr Kamprad, he did not have the ability to go to the four corners of the world to get the product made more cheaply.